Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Old 03-03-2009, 11:19 AM   #61
Give me a museum and I'll fill it. (Picasso) Give me a forum ...
REWahoo's Avatar
 
Join Date: Jun 2002
Location: Texas Hill Country
Posts: 42,117
Quote:
Originally Posted by daloanboy View Post
I am DCAing dividends and interest only and will do so until the markets return to 2007 levels...
I'm sure you realize the odds are you'll be dead before this happens.
__________________

__________________
Numbers is hard

When I hit 70, it hit back

Retired in 2005 at age 58, no pension
REWahoo is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-03-2009, 11:23 AM   #62
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
haha's Avatar
 
Join Date: Apr 2003
Location: Hooverville
Posts: 22,386
Quote:
Originally Posted by Moemg View Post
I also remember the tech boom and some of my friends hung in there until their investments were almost worthless . I did fine because I got out when I got spooked by the craziness . Maybe this time I should have gotten spooked and sat on the sidelines for awhile . I am going to ride it down just a little farther and then I'm getting out until there is some sense of sanity .
I know that you may feel very threatened by this nasty break in the markets.

I have proven to myself and others that I don't know what will happen, I don't even fully understand what has happened already. So I won't be making any suggestions!

But I can point out that the dot com era was different. First, thanks to some very high fliers the S&P was much more overvalued than is is now, and even much more overvalued that it was in Oct 2007.

Second, there were many high flying stocks that never really had a prayer, that were just hope and manipulation.

So although today's economy may appear worse (or not-to anyone living in a high-tech area in th early 21st centruy the economy looked pretty bad), today's valuations based on long term earning power are much lower than the early 2000s.

Ha
__________________

__________________
"As a general rule, the more dangerous or inappropriate a conversation, the more interesting it is."-Scott Adams
haha is online now   Reply With Quote
Old 03-03-2009, 11:39 AM   #63
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,465
We have just gone through a decade and a half when it was easier to make money with financial tricks than it was making and selling real stuff. Not just for the banks, either. For lots of companies and people as well.

Most of thatís gone away. Itís not now so easy to just make money out of nothing, and a lot of the wealth generated is either gone or going away.

Right now this is bad Ė but later it will be good. Kind of like when you say to you kids ďyouíll understand this when you are olderĒ

Itís bad right now because income and wealth is being lost and there is economic confusion. That is causing financial hardship. Itís also bad because of the uncertainty and fear that results for the absence of a clear vision of a positive future. More people are affected by uncertainty and fear than financial hardship.

Itís good because businesses and people will now turn away from this artificial financial stuff and get back to making and selling real stuff. The work force will be larger as more people work longer to fund their lifestyle and retirement. This keeps a lid on labor costs and helps keep inflation under control. It also stimulates demand because working people consume more than non-working people.

Itís good for the US because we import much of the real stuff we consume, so the weakening in demand affect others more now and later the strengthening in demand will create more opportunity for US businesses to satisfy.

Businesses that arenít competitive will fail and be absorbed by their competitors. This will help boost productivity Ė and also profits. It becomes a whole lot easier to distinguish effective business leadership and management from the mediocrity and rest of the herd.

The relationship between risk and reward becomes clearer and strengthens. That is a very positive thing for equity investors.

This isnít happening yet, and it may be too soon to be fully exposed to equities, but the writing is on the walls. If the past decade (and a half) is the lost decade, this upcoming decade will be the revitalization of capitalism. And it will be great for investors.
__________________
MichaelB is offline   Reply With Quote
Old 03-03-2009, 11:49 AM   #64
Recycles dryer sheets
 
Join Date: Aug 2007
Posts: 401
I'll probably ride it as low as it goes. But since I only had 30-35% in the market when all this started (that's down to about 20% now), I can still retire on the remaining portion of my investments (CD's, I-bonds and MM)...as long as the banking system doesn't collapse. I will probably not be putting any new money into the market in the future. If the market ever recovers, I'll be pulling more out.
__________________
DallasGuy is offline   Reply With Quote
Old 03-03-2009, 12:08 PM   #65
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Lsbcal's Avatar
 
Join Date: May 2006
Location: west coast, hi there!
Posts: 5,686
Quote:
Originally Posted by daloanboy View Post
...
I'm in the UK. We avoided most of the great depression compared to USA, but our nemesis was the '70s - our UK stock index dropped 90% - NOMINAL!. Think about it that's an 80% drop and then a further decline of 50%. We had three day working weeks enforced, and power cuts several times a week.
I wasn't aware that the 1970's were that bad in the UK for stocks. Do you know if small caps did better then large caps then? Are there any free data bases to access for general UK stock info for the 1970's?

In the US my inflation adjusted data shows a partial recovery of the Total Stock Market during 1975-76 and small value stocks made a full recovery back up to the 1973 peak. Large value and TSM lagged in the late 1970's but small value and midcaps did well.
__________________
Lsbcal is online now   Reply With Quote
Old 03-03-2009, 12:31 PM   #66
Thinks s/he gets paid by the post
Bikerdude's Avatar
 
Join Date: Jul 2006
Posts: 1,901
Quote:
Originally Posted by MichaelB View Post
We have just gone through a decade and a half when it was easier to make money with financial tricks than it was making and selling real stuff. Not just for the banks, either. For lots of companies and people as well.

Most of thatís gone away. Itís not now so easy to just make money out of nothing, and a lot of the wealth generated is either gone or going away.

Right now this is bad Ė but later it will be good. Kind of like when you say to you kids ďyouíll understand this when you are olderĒ

Itís bad right now because income and wealth is being lost and there is economic confusion. That is causing financial hardship. Itís also bad because of the uncertainty and fear that results for the absence of a clear vision of a positive future. More people are affected by uncertainty and fear than financial hardship.

Itís good because businesses and people will now turn away from this artificial financial stuff and get back to making and selling real stuff. The work force will be larger as more people work longer to fund their lifestyle and retirement. This keeps a lid on labor costs and helps keep inflation under control. It also stimulates demand because working people consume more than non-working people.

Itís good for the US because we import much of the real stuff we consume, so the weakening in demand affect others more now and later the strengthening in demand will create more opportunity for US businesses to satisfy.

Businesses that arenít competitive will fail and be absorbed by their competitors. This will help boost productivity Ė and also profits. It becomes a whole lot easier to distinguish effective business leadership and management from the mediocrity and rest of the herd.

The relationship between risk and reward becomes clearer and strengthens. That is a very positive thing for equity investors.

This isnít happening yet, and it may be too soon to be fully exposed to equities, but the writing is on the walls. If the past decade (and a half) is the lost decade, this upcoming decade will be the revitalization of capitalism. And it will be great for investors.


I feel much better now.
__________________
ďI guess I should warn you, if I turn out to be particularly clear, you've probably misunderstood what I've saidĒ Alan Greenspan
Bikerdude is offline   Reply With Quote
Old 03-03-2009, 01:30 PM   #67
Full time employment: Posting here.
Lusitan's Avatar
 
Join Date: Jan 2006
Location: Boston
Posts: 620
Quote:
Originally Posted by kumquat View Post
Better change your name to Lusitania!
Good one! But my wife has that one claimed already.



That's not fair! How come we don't get to have a band ... ?
__________________
Lusitan is offline   Reply With Quote
For all those with doubts
Old 03-03-2009, 02:50 PM   #68
Moderator
MichaelB's Avatar
 
Join Date: Jan 2008
Location: Rocky Inlets
Posts: 24,465
For all those with doubts

Well, the man has spoken. The one thing Pres Obama had stayed away from 'till now. Hear yourself in his own words Bloomberg.com: Editors' Video Picks

Quote:
What I am looking for is not the day-to-day gyrations of the stock market... but the long-term
Quote:
On the other hand, what you're now seeing is profit and earning ratios are starting to get to the point where buying stocks is potentially a good deal, if you have a long-term perspective on it,
Clear as always, he leaves no doubt. Which raises many in my mind. And I like the guy...
__________________
MichaelB is offline   Reply With Quote
Old 03-03-2009, 03:30 PM   #69
Thinks s/he gets paid by the post
ls99's Avatar
 
Join Date: May 2008
Posts: 4,792
Quote:
What I am looking for is not the day-to-day gyrations of the stock market... but the long-term

So he want's is long term gyrations. Perhaps he should have described how big gyrations.

Though in and of itself that statement is meaningless, now if discusses rates and limits.......
__________________
There must be moderation in everything, including moderation.
ls99 is offline   Reply With Quote
Old 03-03-2009, 04:19 PM   #70
Thinks s/he gets paid by the post
Koolau's Avatar
 
Join Date: Jul 2008
Location: Leeward Oahu
Posts: 3,244
Quote:
Originally Posted by dex View Post
Also, I think there will come a time when the US$ will peak and that would be the time to buy foreign currencies - Australian $, Canadian $, possibly Euro.
Dex,

How do you actually buy foreign currencies? I've heard of buying foreign equities to take advantage of the gyrations of currencies, but are there funds for specific (or, say, non-US currencies)? I'm sure you can open non-US bank accounts, but I'd think the reporting and reconciling the interest/foreign/US taxes would be a pain.

Would seriously consider shorting the US$ at some point but too ignorant to know how.
__________________
Ko'olau's Law -

Anything which can be used can be misused. Anything which can be misused will be.
Koolau is offline   Reply With Quote
Old 03-03-2009, 05:09 PM   #71
Recycles dryer sheets
 
Join Date: Jan 2009
Posts: 170
Quote:
Originally Posted by koolau View Post
would seriously consider shorting the us$ at some point but too ignorant to know how.
etf udn.
__________________
Gpond is offline   Reply With Quote
Old 03-03-2009, 05:34 PM   #72
Thinks s/he gets paid by the post
Bimmerbill's Avatar
 
Join Date: Jan 2006
Posts: 1,631
All the way I guess. I've lost too much to pull whats left out now...
14-18 years till retirement, so I HOPE I have time to recover.

ETA: I'm still putting in 5%, plus match of 4% biweekly.
I just looked, down about 80K from all time highs.
__________________
Bimmerbill is offline   Reply With Quote
Old 03-03-2009, 06:37 PM   #73
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Riding it all the way down.

Even put a little more in yesterday.

My question is this: If I sell out today, what will I do if the market rallies 20% from here? What then if it rallies another 10% on top of that? (we already had one ~25% bear market rally from November to January). Will I know the real thing from a hoax? Probably not. Will I get pulled back in to the market just in time to see my losses compounded as the bear market continues? Or I could sit on the sidelines locking in these losses while the market starts a real recovery?

Because I don't know, because no one can know, I'm sticking with the plan I started with. At least that has a historically proven track record.
__________________
Gone4Good is offline   Reply With Quote
Old 03-03-2009, 07:02 PM   #74
Recycles dryer sheets
Culture's Avatar
 
Join Date: Apr 2007
Posts: 491
I am riding it down, and using the low prices to fill in some sectors that have I have been unwilling to purchase in the past due to high prices (XOP - Oil E&P FTF and GDX - Market Vectors Gold Miners ETF). I now have 2.5% of my equities portfolio in each ETF (5% incease in equity allocation). Oil is not going to stay down.

However, I do not plan on putting any more into equities until the bad news ends, with the possible exception of increasing XOP to 5% of equities if it goes significantly lower than it is today.

__________________
Culture is offline   Reply With Quote
Old 03-03-2009, 07:17 PM   #75
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
dex's Avatar
 
Join Date: Oct 2003
Posts: 5,105
Quote:
Originally Posted by koolau View Post
dex,

how do you actually buy foreign currencies?
etf - fxa, fxe,
__________________
Sometimes death is not as tragic as not knowing how to live. This man knew how to live--and how to make others glad they were living. - Jack Benny at Nat King Cole's funeral
dex is offline   Reply With Quote
Old 03-03-2009, 07:31 PM   #76
Full time employment: Posting here.
Retire Soon's Avatar
 
Join Date: Nov 2005
Posts: 655
In my equities allocation, where I hold mostly Vanguard Total Stock Market I plan to ride it out as low as it may go. It's simply too late to bail.
__________________
"I went to the woods because I wished to live deliberately... and not, when I came to die, discover that I had not lived."

--Henry David Thoreau
Retire Soon is offline   Reply With Quote
Old 03-03-2009, 07:52 PM   #77
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by slazenger View Post
I'm starting to wonder if maybe herd mentality with regard to investing is actually the right way to do it. What was the heard doing in 98-00' - buying like mad and in internet stock of course, and even in 1-2 years they doubled their money. If the herd then soon panicked into 2000 and they panicked within a month or two, they missed most of the drop that continued through the end of 02' and sold much sooner than I did (which was never).
I remember lots of herds of sheep and lemmings . . . never met any members of the flock who actually got out with any gains. Whether the herd was chasing tech stocks, oil, or real estate over the past 10 years I don't know any one who got out near the top.
__________________
Gone4Good is offline   Reply With Quote
Old 03-03-2009, 08:42 PM   #78
Full time employment: Posting here.
 
Join Date: Jul 2008
Posts: 619
All the way to the bottom, baby!

__________________
SarahW is offline   Reply With Quote
Old 03-03-2009, 10:06 PM   #79
Thinks s/he gets paid by the post
 
Join Date: Feb 2007
Posts: 1,905
If the market drops another 50%, it would bring it to about Dow 3500 or so or roughly a 75 - 80 % drop from its peak in October of 2007. This would put the drop in the neighborhood of the Big D levels. Given my asset allocation, this would mean about a 50% drop in my liquid assets from the top of the market back in 07. Just for the fun of it, I re ran my numbers in Firecalc using the assumed drop and guess what - It still works! So, I hoping there isn't a major glitch in Firecalc somewhere... I'm riding this baby down... and hopefully UP some day
__________________
ejman is offline   Reply With Quote
Old 03-04-2009, 03:33 AM   #80
Thinks s/he gets paid by the post
Tadpole's Avatar
 
Join Date: Jul 2004
Posts: 1,170
The only adjustments I may make will be in bond holdings and, maybe selecting the same asset class with lower fees. Otherwise, with respect to equities, I will ride the coaster to the bottom.

The way I see it is, although we are in the process of retiring, we won't need to tap much from the savings for a few years if inflation is not too bad and, knock-on-wood we have few emergencies. So I may be retiring but I am still semi-long term (5-8) years.
__________________

__________________
Tadpole is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Longboard ride ls99 Other topics 0 11-21-2008 07:35 AM
Pictures from Bike Ride TromboneAl Other topics 10 10-27-2008 02:24 PM
what a ride bongo2 Young Dreamers 5 10-15-2008 01:39 PM
Pimp my ride! cute fuzzy bunny FIRE and Money 70 06-28-2005 11:59 PM
Ride the wave.... Tommy_Dolitte Young Dreamers 0 10-09-2004 12:38 AM

 

 
All times are GMT -6. The time now is 09:41 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.